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There is a correction here for the total in the first problem, Ms. Moon should be 930,000 instead of 1, 130,000. Pls help me in this since I don't have any reference, I will review the answer that you will give. Thank you very much.

There is a correction here for the total in the first problem, Ms. Moon should be 930,000 instead of 1, 130,000. Pls help me in this since I don't have any reference, I will review the answer that you will give. Thank you very much.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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There is a correction here for the total in the first problem, Ms. Moon should be 930,000 instead of 1, 130,000. Pls help me in this since I don't have any reference, I will review the answer that you will give. Thank you very much.

Valuation of contributions of partners 1. Mr. Sun and Ms. Moon formed a partnership. Their contributions are as follows: Mr. Sun Ms. Moon 400,000 Cash Accounts receivable 250,000 750,000 180,000 Land Equipment Total 650,000 1,130,000 Additional information: • Only 80% of the accounts receivable is deemed collectible. • The land is stated at original cost. The fair value is P1,000,000. The partnership assumes a P250,000 unpaid mortgage on the land. Ms. Moon acquired the equipment on a long-term financing basis. Ms. Moon promised to pay the unpaid principal balance of P80,000 using her personal funds. The equipment is under- depreciated by P30,000. Requirement: Provide the journal entry to record the partner's contributions. 2. Use the information in problem '1'. The partners agreed to share in profits and losses equally. A partner should make an additional contribution in order for the partners' capital balances to reflect the partners' equal interests in the partnership. Requirement: Which partner should makean additional contribution and by how much?
Transcribed Image Text:Valuation of contributions of partners 1. Mr. Sun and Ms. Moon formed a partnership. Their contributions are as follows: Mr. Sun Ms. Moon 400,000 Cash Accounts receivable 250,000 750,000 180,000 Land Equipment Total 650,000 1,130,000 Additional information: • Only 80% of the accounts receivable is deemed collectible. • The land is stated at original cost. The fair value is P1,000,000. The partnership assumes a P250,000 unpaid mortgage on the land. Ms. Moon acquired the equipment on a long-term financing basis. Ms. Moon promised to pay the unpaid principal balance of P80,000 using her personal funds. The equipment is under- depreciated by P30,000. Requirement: Provide the journal entry to record the partner's contributions. 2. Use the information in problem '1'. The partners agreed to share in profits and losses equally. A partner should make an additional contribution in order for the partners' capital balances to reflect the partners' equal interests in the partnership. Requirement: Which partner should makean additional contribution and by how much?
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